Cabinet has approved Shs20 billion in compassionate support for traders whose businesses were destroyed during the October 2025 Kampala floods, while setting in motion plans to remove businesses operating in spaces originally designated as parking basements across the city.
The compensation package, approved during the 16th Cabinet meeting on November 9, 2026, provides financial relief to 1,841 verified traders affected by the floods. However, the accompanying directive on basement businesses signals a wider enforcement exercise that could force traders operating in converted parking spaces to find alternative premises.
The Minister for ICT and National Guidance, Justine Kasule Lumumba, announced the decisions on November 10 at the Uganda Media Centre, where she also called on building owners to instruct tenants occupying designated parking basements to vacate.
The proposed evictions are not yet being implemented, with Kampala Capital City Authority (KCCA) awaiting further guidance on how to execute the Cabinet directive.
Of the Shs20 billion approved, Shs18.9995 billion has been allocated to the 1,841 verified traders whose businesses were affected by the floods of October 30 and 31, 2025.
The remaining Shs1.0005 billion will go to the Federation of Uganda Traders Associations (FUTA), comprising Shs682.5 million for operational support and Shs318 million as the government’s contribution to the association’s revolving fund.
Government has emphasised that the payments constitute ex-gratia assistance and do not amount to an admission of legal liability for the losses suffered by the traders.
Although Cabinet has approved the allocation, the money has not yet been disbursed, and government has not announced when the beneficiaries will receive their payments.
Basement evictions move towards implementation
Beyond the compensation package, the basement directive could have far-reaching implications for Kampala’s commercial property sector.
Government wants all buildings across Kampala to stop using spaces approved for parking as commercial premises. The directive is not restricted to properties affected by the October 2025 floods but extends to every building where parking basements have been converted into shops.
During the November 10 briefing, Lumumba called on property owners to take responsibility for the directive by instructing traders occupying the affected spaces to leave.
KCCA spokesperson Daniel Nuwabiine confirmed that the authority had received the Cabinet order, maintaining that basements approved for parking should remain available for that purpose.
He indicated that KCCA was awaiting an extract of the Cabinet minutes to guide implementation of the decision.
The authority is expected to engage building owners and affected businesses as it works towards enforcing the directive. Nuwabiine also described the conversion of parking basements into commercial spaces as a longstanding problem inherited from previous administrations.
The enforcement exercise could affect businesses that have operated in these premises for years, raising questions about relocation, rental agreements and the costs traders will incur in finding alternative trading spaces.
Lord Mayor backs directive but calls for peaceful evictions
Kampala Lord Mayor Ronald Balimwezo Nsubuga has expressed support for the Cabinet decision, arguing that restoring parking basements to their original purpose could help address some of the city’s persistent traffic congestion.
With many commercial buildings in the central business district operating shops in spaces initially designed for vehicle parking, returning these areas to their approved use could increase parking availability and reduce the number of vehicles competing for limited roadside and street parking.
However, Balimwezo has cautioned against implementing the directive through abrupt evictions.
He wants the exercise conducted peacefully and in phases, with authorities first identifying buildings that have converted designated parking spaces into commercial premises.
His position reflects the need to enforce building regulations without unnecessarily disrupting traders whose businesses have operated in the affected premises for extended periods.
A phased approach would also give affected businesses an opportunity to relocate merchandise, negotiate new rental arrangements and secure alternative premises before enforcement begins.
The balance between restoring compliance and protecting traders from sudden business disruption is likely to shape how KCCA implements the Cabinet directive.
Floods exposed weaknesses in Kampala’s drainage system
The October 2025 floods affected traders at St Balikuddembe Market, commonly known as Owino Market, and several commercial buildings, including Nana Arcade, Totala Building, Capital Centre, Pentagon Plaza, French Plaza, Premier Arcade, Qualicel Mall, Freedom Centre, Nabukeera Plaza, Ssekaziga Arcade, Jesco Centre, Jamboole Arcade and Tuba Plaza.
Floodwater entered business premises, destroying merchandise and other property and leaving traders facing substantial financial losses.
Investigations presented to Cabinet identified several factors that contributed to the flooding, including blocked stormwater outlets, construction interference along the Nakivubo Channel, accumulated silt, garbage and debris, and illegally constructed pavements and walls.
Developments along Sebaana Kizito and Allen roads were also flagged over alleged interference with existing drainage infrastructure.
The findings point to a wider challenge involving urban development, drainage management and enforcement of approved building plans.
In July 2026, KCCA informed Parliament that Kampala has approximately 362.3 kilometres of drainage infrastructure distributed across eight major catchments: Nakivubo, Lubigi, Walufumbe, Nalukolongo, Kansanga, Kinawataka, Nakamiro and Mayanja.
Despite the existing network, flash flooding continues in areas where drainage channels have been blocked, encroached upon or affected by construction and other developments.
One-month deadline for task force
To address the underlying problems, Cabinet directed the Office of the Prime Minister, KCCA and other government agencies to coordinate interventions targeting drainage infrastructure and compliance with approved building designs.
A multi-agency task force comprising the ministries responsible for Finance, Kampala, Water and Environment, and Works and Transport, alongside the National Environment Management Authority, National Water and Sewerage Corporation and FUTA, has been given one month to develop an implementation work plan.
The compensation approval follows months of pressure from trader associations and negotiations with government. Verification was necessary after different institutions submitted varying lists of traders claiming to have suffered losses during the floods.
Traders who believe they were wrongly excluded from the 1,841 verified beneficiaries can submit complaints to KCCA and the Office of the Prime Minister.
However, several questions remain unanswered, particularly when the approved compensation will reach beneficiaries, how traders affected by the basement directive will be supported during relocation, and whether property owners who converted parking spaces into shops will face any enforcement action.
For Kampala, the two decisions present both immediate relief and a longer-term urban management challenge. While the Shs20 billion allocation offers some financial support to traders recovering from the floods, the proposed basement evictions could reshape how commercial buildings use their available space.
The effectiveness of the exercise will ultimately depend on whether government can enforce building regulations, restore parking capacity and improve drainage infrastructure without creating another wave of business disruption for Kampala’s traders.
